Treasury Secretary
Steven Mnuchin
says he may be heading to Beijing for trade negotiations, suggesting an easing of U.S.-China tensions that have widened to include big-name companies in both countries.

Mr. Mnuchin said Saturday he is considering the China trip, and on Sunday, China’s Commerce Ministry said in a terse statement that “the Chinese side welcomes this.”

The display of good will, following weeks of harsh words from both sides, gives rise to hope of a thaw in a trade stalemate that has seen both countries slap tariffs on some goods and threaten to impose them on a lengthening list of products.

“It’s very likely” that Mr. Mnuchin will make the trip, said a Chinese official with knowledge of Beijing’s decision-making process. Mr. Mnuchin, who declined to comment on the timing of the visit, said he is “cautiously optimistic” about reaching an agreement with Beijing that could defuse the bilateral trade conflict that has rattled world markets in recent weeks.

Mr. Mnuchin told reporters Saturday that he met with
Yi Gang,
China’s central-bank governor, at the spring meeting of the International Monetary Fund. Mr. Yi passed along Mr. Mnuchin’s message about his interest in going to Beijing, according to people familiar with the matter.

U.S. officials say Mr. Mnuchin might be accompanied by other U.S. officials, including U.S. Trade Representative
Robert Lighthizer.
The prospect of a Mnuchin trip to Beijing has divided administration advisers, some of whom argue he could get ensnared in negotiations that would yield marginal results. The Trump administration has criticized prior administrations for being too willing to accept minor changes in Chinese practices.

The overtures come as tensions between the governments have already affected major technology companies on both sides. Last week, the U.S. barred American businesses from supplying technology to
ZTE Corp.
, a large Chinese maker of telecom equipment, for seven years.

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Both countries could get hurt in the trade battle, but anxiety is running particularly high in China following the U.S. ban on ZTE, long viewed as a national champion for its effort to take a global lead in establishing 5G mobile internet networks.

In an internal report dated April 20, an economist at China’s state-run Assets Supervision and Administration Commission said the U.S. action against ZTE would have a crippling impact on a wide swath of the state-owned sector, including China’s three large telecom carriers and their suppliers.

“Against the backdrop of a trade war, this incident has triggered a lot of anxiety,” wrote
Wang Jiang,
author of the report, which was reviewed by The Wall Street Journal.

The U.S. Commerce Department took the action after concluding that ZTE had broken a year-old settlement to resolve alleged violations involving sales to Iran and other countries.

On Friday, the Commerce Department said it was willing to consider new information from ZTE, which, in a filing with the Hong Kong stock exchange Sunday said it was “making active communications with relevant parties and seeking a solution.”

Still, the U.S. action threatens to cut off ZTE’s supply chain and disrupt those of other Chinese companies such as the China Aerospace Science and Industry Corp., the main contractor for the Chinese space program, Mr. Wang wrote in the report. He said ZTE couldn't find substitutes for most of the chips and other products it purchased from its American suppliers.

While calling ZTE’s actions “extremely stupid,” Mr. Wang suggested that the government put in place contingency plans to protect other Chinese companies that could be targeted by the U.S.

On the U.S.’s part, President
Donald Trump
on April 5 threatened to hit another $100 billion in Chinese imports with tariffs in a separate dispute over intellectual property. U.S. business groups with ties to the administration said a list of items to be targeted has largely been completed.

Delaying the publication of the list, however, could signal to Beijing that the U.S. is interested in talks, and it could serve as a way of encouraging Beijing to keep up the pressure on North Korea over nuclear weapons.

Over the weekend, Ben Purser, deputy assistant secretary of state for counter-proliferation, met with Chinese officials in Beijing, according to a person with knowledge of the matter. “China has been very helpful on the sanctions with us,” Mr. Mnuchin said.

But it is far from clear how long the Trump administration will hold off on the tariffs, and the administration is divided over how to pursue trade issues with China.

Mr. Mnuchin is joined by
Larry Kudlow,
director of the National Economic Council, in favoring a softer approach. They see Chinese President
Xi Jinping’s
recent speech pledging to ease restrictions on foreign autos as a significant concession, say individuals familiar with the deliberations.

Others, including White House trade adviser
Peter Navarro,
favor a tougher line. They argue that Mr. Xi’s pledges don’t represent a significant liberalization and that recent tariffs imposed by China on U.S. agriculture require a sharp response.

Those arguing for a tougher response have been pushing to expand any possible trip to include Mr. Lighthizer, who has long been a critic of Chinese economic practices, and perhaps others.